2011-01-19 Last week, the Supreme Administrative Court judgement passed a ruling confirming the mysterious Livela company’s right to the untaxed import of crude oil and fuels. This company is most likely linked to politicians belonging to the Party of Regions. The Court’s judgement may form the basis for the resumption of the company’s activities; it has led to multi-billion losses for the Ukrainian budget and harmed the profitability of the oil processing industry.

Livela is a daughter company of the secretive Taistra firm; it has been operating on the basis of an outdated Ukrainian law from 1992 on the protection of foreign investments, which exempts companies with foreign capital from the payment of taxes (customs duties, VAT and excise duties). Although the act expired in 2003, the next year Taistra managed to obtain a judgement from the Court which preserved its tax breaks. Livela worked actively from August to November 2010 to rapidly monopolise the market for fuel imports (resulting in an 80% market share). In December, in connection with a investigation by the anti-monopoly committee, Livela ceased its imports.

The losses to the Ukrainian budget amounted to approximately 3 billion hryvnia (US$375m). The import of cheap fuels has caused a decline in the profitability of refineries in Ukraine; the LUKoil refinery in Odessa suspended production in October. On 15 January, the Executive Director of TNK-BP in Ukraine announced that if the Government does not take measures to protect the Ukrainian petroleum industry, production in the group's refineries in Lysychansk will cease.

It is not known who benefits from Taistra’s activities, but it is clear that it must be supported at the highest level of the Party of Regions (some sources suggest that the first Deputy Prime Minister Andriy Kluyev is involved). If Livela resumes importing fuels, this could lead to the rapid bankruptcy of the already unprofitable Ukrainian oil-refining industry."

Now 'Ukrainska Pravda's brave journalists run a story providing strong circumstantial evidence that Yanukovych and his band of crooks had indeed been using 'Livela' as a milch-cow, almost certainly to fund the nationwide 2010 local election campaign.

Amongst their conclusions:

According to the Ukrainian customs data, "Livela" and "Taistra" actively imported fuel in 2004, 2007 and 2010, respectively. Viktor Yanukovych was either prime minister or president during these years,

In the summer of 2010, when the Party of Regions began to prepare for country-wide local elections the PoR headquarters were headed by First Deputy Prime Minister of Ukraine, Andriy Klyuyev.

"Taistra" is linked, via PoR parliamentary deputy Volodymyr Zubyk, to a big-time property developer 'InterHalBud' which has probably been used, in turn, to 'legalise' 'Taystra's liquid assets - converting them into high-rise residences and other buildings. Zubyk has previously been associated with Klyuyev.

According to the Ukrainian customs data, "Livela" started to import fuel to Ukraine again in August 2010. A month later the electoral campaign for election of deputies and heads of local councils was launched.

Local elections formally ended on November 3rd. According to the country's customs service, on the 23rd of that month, "Livela" ceased importing fuel to Ukraine.

The 'U.P' article provides a stunning graphic for the last 5 months of 2010 showing the quantity of diesel and petroleum that was imported by 'Livela' during that period and its correlation with the 2010 election campaign... In November 2010 around 80% of the country's diesel and gasoline was imported via "Livela" - in December it dropped to zero.

p.s. Is it any wonder that the EU are wary of signing Association Agreements with party leaders who 'legally' steal money from state coffers to fund their political election campaigns while at the same time they imprison political rivals e.g. for 'overpaying their driver'?

"To these [Eastern Partnership] oligarchic elites the EU’s toughly regulated economy model is, as one Brussels official put it to me, a “Trojan horse,” which could undermine everything they currently possess. Which is why with three of the six countries—Armenia, Azerbaijan, and Belarus—there is currently no prospect of any free trade agreement and in the other three—Georgia, Moldova, and Ukraine—there is resistance to the proposed Deep and Comprehensive Free Trade Area (DCFTA) with the EU. [No more 'Livela fiddles for a start..LEvko]

Viktor Yanukovych’s Ukraine is the starkest example of this duality. The Ukrainian leadership knows that the EU offers its best development model and route out of poverty, but the short-term political agenda—put crudely, the preservation of power and wealth—trumps a longer-term vision. The jailing of former prime minister Yulia Tymoshenko on October 11 was a slap in the face to concerted efforts by the EU to encourage Ukraine to look west...."

....If a new Ostpolitik is to have a really transformative effect in these post-Soviet countries, then its central component should be an eventual membership perspective. Those who baulk at this prospect should not just consider the positive outcomes it could bring but also the negatives of a continuing status quo. In the eastern regions of Belarus, Moldova, and Ukraine, that would mean they remain a continuing source of criminality, poverty, and perhaps political repression, while in the South Caucasus, that means they will continue to be sources of potential conflict and disaster—while in both cases the big western neighbor of these regions, the EU, will inevitably end up fighting the fires and footing the bills." [Hmmm...]

KIEV, Ukraine -- One sunny summer morning, a stray mongrel the neighbors called Naida swallowed a piece of sausage she found on the ground. Soon after, she collapsed.

A dog in a privately run animal shelter in the town of Hostomel outside Kiev, looks on. Animal welfare groups accuse Ukrainian authorities of resorting to illegal, inhumane methods of stray dog culling that cause long, agonizing deaths. The activists claim that dogs are poisoned, injected with forbidden substances and subjected to severe pain as officials rush to clean city streets of stray animals in preparation for the Euro 2012 soccer championship next summer.

For the next two hours the dog convulsed in agony, barking and howling in a high-pitched voice, saliva and blood dripping from her mouth.

"What did they punish you for, my good girl?" an elderly woman said as she wept and doused the dog with water, hoping to relieve some of the pain. Then Naida died.

Full official statistics are hard to come by, but figures and estimates provided to The Associated Press by authorities in the Euro 2012 host cities of Kiev, Donetsk, Kharkiv and Lviv show more than 9,000 dogs have been put to death over the past year.

Animal protection groups believe the number is far higher.

"It's a slaughterhouse," said Asya Serpinska, head of the Ukrainian Association of Animal Protection Organizations.

"We are convinced that there is an unofficial order to purge Euro cities of stray animals so that, God forbid, some stray dog doesn't bite some foreigner."

KIEV, Ukraine -- One sunny summer morning, a stray mongrel the neighbors called Naida swallowed a piece of sausage she found on the ground. Soon after, she collapsed.

A dog in a privately run animal shelter in the town of Hostomel outside Kiev, looks on. Animal welfare groups accuse Ukrainian authorities of resorting to illegal, inhumane methods of stray dog culling that cause long, agonizing deaths. The activists claim that dogs are poisoned, injected with forbidden substances and subjected to severe pain as officials rush to clean city streets of stray animals in preparation for the Euro 2012 soccer championship next summer.

For the next two hours the dog convulsed in agony, barking and howling in a high-pitched voice, saliva and blood dripping from her mouth.

"What did they punish you for, my good girl?" an elderly woman said as she wept and doused the dog with water, hoping to relieve some of the pain. Then Naida died.

Full official statistics are hard to come by, but figures and estimates provided to The Associated Press by authorities in the Euro 2012 host cities of Kiev, Donetsk, Kharkiv and Lviv show more than 9,000 dogs have been put to death over the past year.

Animal protection groups believe the number is far higher.

"It's a slaughterhouse," said Asya Serpinska, head of the Ukrainian Association of Animal Protection Organizations.

"We are convinced that there is an unofficial order to purge Euro cities of stray animals so that, God forbid, some stray dog doesn't bite some foreigner."